In a remarkable admission at the AGM of Australian oil and gas firm Santos today, Chairman Peter Coates revealed its business model is based on a ‘four degree’ climate pathway, completely at odds with international efforts to meet the Paris climate change agreement.

The company defeated a resolution that would force Santos to disclose the risks that climate change poses to its operations. Many institutional investors voted with the board to reject the resolution, despite their public claims that they support climate change risk disclosure and Mr Coates’ revelation that the company was pursuing a four degree global warming pathway.

Santos would not reveal the final numbers on climate disclosure, though 7% of shareholders backed an enabling resolution which would have required the vote to go to the floor of the AGM.

“Santos’ effective climate denial shows a breath-taking failure to come to grips with a world in transition,” said Market Forces Analyst Dan Gocher. “But today’s AGM also highlights that institutional investors are toothless tigers when it comes to forcing change from the companies they own.”

Earlier this year, the Australian Prudential Regulatory Authority (APRA) reiterated that climate risks are “distinctly financial in nature”; and that many of these risks are “foreseeable, material and actionable now.”

“With a few notable exceptions, investors are doing a major disservice to Australians whose retirement savings are tied up in a company ignoring common sense, as well as clarion calls on climate risk from bodies including the Bank of England and the Australian Prudential Regulatory Authority (APRA),” said Gocher.

APRA’s recent warning builds on a legal opinion released in late 2016 by Noel Hutley SC, which states that company directors who don’t properly consider climate related risks could be liable for breaching their duty of due care and diligence.

“Unfortunately, by the time this sinks in, it may not only be too late for Santos and its investors, but also for protecting our safe climate,” said Gocher.